Jerry Brito

The end of broadcasting?

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More buzz today comes from Disney’s announcement that it will offer free, ad-supported access to their top ABC and Disney Channel shows online. No doubt this is great news for consumers because it represents more choice. You can now get ABC hit Lost for free live on TV with ads, on the web free with ads, or free on TiVo with blurry ads. You can also pay iTunes $1.99 for an episode without ads, or you can buy the season DVD, which also doesn’t have ads. It’s probably distributed in other ways that I don’t even know about.

However, I’m not sure this announcement represents the sea change some are making it out to be. I think Mark Cuban’s thinking on this issue has been the most lucid. Broadcast TV will not be destroyed–at least not yet–for a few simple reasons. For one thing, online video on demand overlooks live TV. It’s not very feasible today to stream live events that draw large audiences, such as the World Series for example. (I’m curious about the sort of numbers CBS got for the NCAA tournament. They only streamed the early rounds, right?) Second, VOD is a terrific new channel for content that has established its popularity on traditional media, but how do you establish an online-only hit show? It might work for niche shows, but the TV network model is still best suited for lowest common denominator production and distribution.

So, I don’t think VOD will ever completely supplant pre-scheduled feeds. What might change is how these feeds are distributed. The networks could move online–both feeds and VOD. This would give them a much larger audience than cable systems provide, as well as new revenue opportunities. The only thing that might get in the way is that doing so would undercut the fees that networks get paid by cable operators to carry them on their systems. Eventually, a broadband connection and a video AirPort Express could supplant your need for a cable subscription. If that’s the case, the telcos are engaging in one expensive boondoggle by investing so much to get into the video market.

Apr 10, 2006 | Comments